Archive · 24 Jul 2026
US Business Activity Rebounds in July Amid Iran Tensions
In July 2024, business activity in the United States improved, especially in the services sector, which got a boost from events like the FIFA World Cup and Independence Day celebrations.
This improvement pushed the overall business activity index to its highest level in eight months.
However, the manufacturing sector is slowing down, and there are concerns about rising energy prices and supply chain disruptions due to tensions in the Middle East, particularly involving Iran.
These issues could make the current economic improvement short-lived and might lead to higher inflation.
US business activity rebounded in July, driven by a sharp improvement in the services sector.
The services PMI rose to 53.6, its highest since November, while the manufacturing PMI edged down to 53.8.
The Composite Output Index reached an eight-month high of 53.6, up from 51.9 in June.
Economists warn that the rebound may be temporary due to temporary boosts from events and rising tensions in the Middle East.
Renewed hostilities involving Iran have disrupted shipping and pushed Brent crude prices back toward $100 a barrel.
- Who
- S&P Global, Chris Williamson
- What
- US business activity rebounded in July, driven by the services sector, but faces risks from Iran tensions.
- When
- July 2024
- Where
- United States
- Why
- The rebound was driven by spending linked to the FIFA World Cup and Independence Day celebrations, but risks include escalating tensions in the Middle East and rising energy prices.
Optimistic View
Pessimistic View
Economic Growth
Optimistic View
The rebound in business activity suggests a solid start to the third quarter with potential GDP growth of around 2% in the July-September quarter.
Pessimistic View
The improvement may be temporary due to temporary boosts from events like the FIFA World Cup and Independence Day celebrations.
Manufacturing Sector
Optimistic View
The manufacturing PMI remains above 50, indicating continued expansion.
Pessimistic View
The manufacturing sector is showing signs of losing momentum, with the weakest pace of expansion since March.
Supply Chain and Inflation
Optimistic View
The data indicates a strong start to the third quarter.
Pessimistic View
Renewed hostilities involving Iran and rising energy prices could disrupt supply chains and reignite inflationary pressures.
- Services PMI
- 53.6
- Manufacturing PMI
- 53.8
- Composite Output Index
- 53.6
- Expected Services PMI
- 51.5
- Expected Manufacturing PMI
- 54.3
- Brent Crude Price
- $100 per barrel
- US Gasoline Price
- Above $4 per gallon